Steamworks Brewing Co. confirms company restructuring

Bayfield Beer Factory will close Dec. 31, 2009

 

            DURANGO, Colo. – Demonstrating fiscal responsibility and in an effort to return the whole company to profitability, Steamworks Brewing Co. (Durango, Colo.) has finalized its plan to restructure its business model. The move includes closure of the Bayfield Beer Factory (including restaurant operations) and sale of the property and equipment in Bayfield, as well as a refocus on the successful and profitable Durango operation.

            “We are in a very good financial position outside of the Bayfield operation,” said Kris Oyler, Steamworks CEO and co-founder. “After five years of continual losses in Bayfield, and new pressure by our shareholders to return to profitability, we have decided to divest the company of the operations in Bayfield.”

            The immediate plan calls for sale or lease of the building and property in Bayfield Center. Asking price is $1.395 million, for the assets appraised in July 2008 as $1.475 million. This includes two parcels in Bayfield Center, one vacant, plus the approximately 8,000 sq.ft. brewery space and restaurant.

            In spite of Steamworks’ successes and future potential in wholesale national beer sales (some 40 percent growth in 2009) the company will cease off-premise distribution with the exception of key accounts in Southwest Colorado. The bulk of wholesale production has been focused at the Bayfield operation. Brewery production now will be confined to the Durango brewpub – a 1400-barrel operation.

            “Essentially 1400 barrels will meet the demand at the brewpub,” said Oyler. “We would like to continue to service our regional and statewide accounts as we’ve received tremendous support in Colorado. To do this in the immediate future we would look toward engaging a contract brewing operation – in essence, another brewery producing beer according to Steamworks’ recipes. This is very common in the industry, especially with regional breweries who are distributing long distances from their central operation.”

            Going forward, Steamworks will return to its core competency in Durango, investing funds that over the years had been diverted to Bayfield into the Durango operation. Some brewery equipment to bolster production capabilities will be moved to Durango, but the bulk of it will be sold.

            “When we opted to build the Bayfield operation in 2003-2004, the economic climate in Bayfield was strong,” said Oyler. “That changed, and a subsequent series of unforeseen events such as Bayfield’s sewer issues and building moratorium led us to this current situation and our tough decision. We have not ruled out expansion in the future, but in the current economic climate, we want to be responsible to our investors and to our home community of Durango, which has embraced us and supported us since 1996.”

            Noted Brian McEachron, director of marketing and sales and co-founder, “In the past few years we have worked hard turning Steamworks Brewing into a nationally-recognized brand and we see the opportunity to capitalize on those efforts at our brewpub with our craft beer, culinary leadership and unique service experience more than ever before in company history. That time spent in distant markets trying to emulate our success will now be re-focused back in our little Napa Valley of craft beer here in Durango.”

Steamworks Brewing Co. is located at 801 E. Second. Ave., Durango (970.259.9200). For further information, visit www.steamworksbrewing.com.